Answers to your insurance questions

You passed your learners license exam, congratulations! Now is the time for you to start considering how to control your insurance costs.

As a driver on a learners permit you do not have to be listed on the insurance policy. You need to follow certain rules about the operation of the vehicle such as having a qualified supervisor driver with you when you are behind the wheel. You should know the rules of your province/territory and be sure to observe them carefully. The consequences of tickets at this stage are dire.

Now you decide if you are going to take driver training or just practice until you feel confident enough to take the drivers test. You need to find out what the requirements are for where you live. Some provinces/territories will require you to have your learners license for a set amount of time before you can attempt the drivers test.

You will hear that taking driver training will save you a lot of money on insurance. Like everything else in insurance this is not an absolute statement.

In Alberta there is a GRID rating system that saves young male drivers a lot of premium dollars. A newly licensed male driver without driver training and living in the City of Calgary will pay $1839 for $1 million Public Liability and Property Damage (PLPD) and Accident benefits. Most companies will add from $25 to $50 for SEF 44 Family Protection endorsement. This driver will save $184 because he has driver training. This will drop to a savings of $92 the second year. The third year it doesn't make a difference to the PLPD.

Where it does make a bigger difference is to the Collision and Upset coverage under Section C of the policy. Most young male drivers do not have this coverage because it is often higher then the PLPD premium. If you are planning on insuring a newer vehicle or a vehicle that is leased or financed then the savings will be significant for driver training because of the need to buy the Collision and Upset coverage.

Driver training involves so many hours of education with 15 hours of classroom time followed by a test. Then you are on to your road work which is 10 hours. You can try for your test as soon as you have met the requirements of the province/territory where you live for experience with the learners class of license. To get the insurance credit you must have a completed driver training certificate.

The driver training certificate does not give you the right to drive a vehicle by yourself. It attests to the fact that you have fulfilled the obligations. It is deductible as an education expense so be sure to keep your receipt. How much does driver training cost? Expect to pay anywhere from $500 on up with the average being about $650.

Many provinces/territories are going to a Graduated Driver Licensing (GDL). If you get a ticket while you have a GDL then you acquire points against your license.If you get eight or more points within a two year period you will have your license automatically suspended for one month.

What is worse is the cost of these tickets. Let's go back to our newly licensed male driver in Alberta. He took his driver training and purchase $1 million PLPD, Accident Benefits and SEF 44. He is legal to drive down the road. Unfortunately his foot is a little heavy on the pedal and he has two tickets. His annual insurance of $1700 per year just went up to $2100 per year. If these tickets were considered "serious" then the amount would be $2535 per year! Even one ticket considered "criminal" such as driving with undue care and attention with kick that amount of $1700 per year to over $6600 per year!

Driver training does help train the inexperienced driver in operating a vehicle in a safe and responsible manner. It does reinforce the training that the parents provide. When you consider the possible costs of a young driver making bad choices it seems a fairly reasonable investment.

TurnersTips recommends driver training for all new drivers. Young female drivers get much better rates then the young males. The young female still needs the professional expertise of a driving instructor to fine tune her skills and help her to stay ticket-free and not in car crashes.

Most provinces/territories track tickets/convictions for 36 months. The count starts from the day the ticket is paid, not the day you get the ticket. Car accidents are tracked for six years.

Work with your agent or broker to help you determine what is the best insurance company for your needs. You may change companies more then once in the next few years as you try to lock into the best rates. Be sure you understand the coverages being offered. Fully understand the coverages you do not take. Take control of your insurance.